Archive for the ‘commodities’ Category

ILC 2009: Earl Geddes – VP at CWB – Developing Innovative Services and Markets For the Western Canadian Farmers

July 17, 2009

I had the the opportunity to sit down with Earl Geddes, Vice President of Farmer Services, Canadian Wheat Board at the International Livestock Congress. Earl and I discussed some of the new markets and services being developed by the board for farmers. I also asked Earl about how different demographics are using the boards programs and what they are doing as a company to address that.

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ILC 2009: Brant Randles – Louis Dreyfus Canada – Feed Grain and Oilseed Complex Outlook

July 17, 2009

At the International Livestock Congress I spoke to Brant Randles, President of Louis Dreyfus Canada regarding his outlook for feed grains and oilseeds in the future. Brant and I also talked about the future of grain handling as it pertains to identity preserved crops and the future of the rail system for handling grain from a Canadian perspective.

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USDA Planting Report Jolts the Market

June 30, 2009

This morning the USDA provided an updated planting report and the market was taken for a ride lower due to above expected corn and wheat acres. The following is commentary from Jon Driedger of FarmLink Marketing Solutions and Stephan Gmehlin of Farms.com

Below is Jon Driedger of FarmLink Marketing Solutions commentary.
The corn acres was the big surprise, and today’s trade clearly reflected that. Wheat was a bit negative as well, but managed to hold up relatively better than the corn. The soybean numbers came in roughly as expected, confirming an S&D that has little room for yield adversity going forward, which allowed it to hold up quite impressively today given the negative sentiment coming from corn.

As with all major government reports, the market’s reaction to the news over the coming days will be more important than the numbers themselves. Sentiment may have shifted, but the main crops still have a lot of weather ahead to trade, and in the case of corn and wheat, current values have already priced in a fair amount of bearish news in recent weeks. Most of the minor crops are indicating smaller year-over-year plantings in the U.S., including some important ones to western Canadian growers such as canola, barley, flax, mustard and dry beans. So while the overall initial impression of this report was bearish, it will take some time for the markets to fully digest the details, and for prices to respond in local terms.

Stephan Gmehlin commented on Farms.com this morning that, USDA surprised many people with this years Acreage report. Corn acres were actually up 2 million acres from the spring planting intentions report with an estimated 87 million acres this is the second largest corn crop planted since 1946, behind 2007. Iowa planted 13.7 million acres and Illinois added 200,000 acres from 2008 for a total of 12.3 million acres with Nebraska rounding out the top 3 states at 9.4 million acres. This corn acreage figure is a total surprise as most analysts were looking for acres to go down from March planting intention report, but this figure from USDA exceeded even the highest estimates of analysts by a million bushels.

Crop Marketing Update – Jon Driedger – FarmLink Marketing Solutions

June 24, 2009
On Monday afternoon I had the opportunity to sit down with Jon Driedger, a market analyst with FarmLink Marketing Solutions in Winnipeg. A day before the Canadian StatsCan acreage Report was released, Jon provided great insight into the dynamics facing the grains, oilseeds and pulse markets this summer and fall in North America.  

A special thank to Jon for his time and comments. Please take the time to check out FarmLink Marketing Solutions — Maximizing profitability farm-wide, through informed marketing decisions.

Larry Weber Comments on the USDA Planting Report

April 1, 2009

Yesterday the USDA planting intention report was released which has stirred lots of speculation about the future movement of of agricultural commodity price. On BNN yesterday Larry Weber of Weber Commodities spoke about the planting report and some of the ramifications. Larry speculates that Soybeans could be headed to 10-11 dollars per bushel this spring. With this report Larry believes that a floor has been established for soybeans at $9.50. As Larry notes in the video the reality will be a global acreage battle between corn and soybeans for the upcoming years.

According to the USDA’s report, there will have 6 million less corn acres in comparison to last year. Wheat acres are about where everyone expected. If you are interested in learning more about Larry Weber check out his website at http://www.webercommodities.com

Part 2 of 2 Lloyd Dyck CEO of Brett Young – Commodity Price Outlook, The Forage Industry Outlook and the EU and GMO Canola

March 27, 2009

In part 2 of my interview with Lloyd Dyck, CEO of Brett Young we discuss how the access to credit is a bigger concern than the commodity price volatility for people in agriculture. Lloyd also talks about the forage business at Brett Young, where forage genetics are coming from and how hybrid alfalfa is growing in market share. Lastly Lloyd talks about how the EU finally excepting GMO canola imports will ultimately affect Canadian agriculture.

I would like to thank Lloyd Dyck for taking the time to talk to me and RealAgriculture.com
If you are interested in Brett Young products please go to their website at http://www.brettyoung.ca/

Bill Lapp — Advanced Economic Solutions — Discusses the Commmodity Market Outlook

March 9, 2009

I just listened to Bill Lapp, an economist with Advanced Economic Solutions speak about the outlook for commodities in Edmonton. Lapp was very interesting, candid and provided great insight into the commodity market.

The key points that Lapp focused on were:

  • Brazil, Russia, India and China have led the world growth over the last 10 years.
  • The rising US deficit is going to be an ongoing concern. As the US dollar weakens commodities should strengthen.
  • Commodities tend to jump and then plateau. He showed a chart of corn prices back to the 1800’s and showed the group that this has been in case with corn over history.
  • World coarse grain usage is now rising much faster than long term gains. The result is going to be acre battles between major crops. For example, corn and soybeans.
  • The ethanol industry in the US has moved from the gold rush to significant financial issues. Currently, 20% of the ethanol production capacity is idle in the US.
  • The US cattle and chicken industries are under significant financial pressure.
  • Food use of soy oil is going to decline in the US for the fourth consecutive year due to the growth of canola and palm oil. In the US consumers view, canola is a healthier oil.
  • The North American recession has created real financial trauma. The longer the economy is slow, the more likely the US moves to a protectionist agenda of which Lapp is extremely concerned about.

    If you are ever presented with the opportunity to hear Bill Lapp speak I encourage you to attend.

Alliance Seed Corporation is Created – Dale Alderson

March 5, 2009

Last week there was a very unique joint venture formed that will provide additional genetics to the Western Canadian market place.  Alliance Seed Corporation is a new seed company formed by Parrish & Heimbecker, Patterson Grain and several inland terminals in Saskatchewan.  As Dale mentions in the video, the new company will be focusing in cereals but has plans to eventually launch a canola line as well.  

Part 2: Jay Bradshaw – Syngenta – How the Farm Customer Base is Changing and the Commodity Price Outlook

February 20, 2009

This is part two of my interview with Jay Bradshaw from Syngenta Canada. In this interview Jay discusses Syngenta’s strategy in Canada and how the decreasing amount of farmers is changing Canadian agriculture. Jay also talks about commodity prices over the last two years and what he thinks farmers can expect in the future.

My Chile Trip: Winter Canola and Salmon Industry Have Trouble

February 11, 2009


Like many industries based on plant science and biology, there is alot of risk. This is definitely the case with the collapse of the Chilean salmon and winter canola industry. Due to lack of proper environmental practices and controls the salmon farms have been infected with a virus which is killing the salmon population. Consequently this has also significantly affected the winter canola business because its used in salmon feed rations. Compounding this issue is that there is no on farm storage in Chile. There are 40,000 acres of winter canola in chile which provides a nice rotation for wheat farmers.

According to a recent story by ipsnews.net, “Salmon is not a native species in Chile, but was introduced for farming in the 1980s. Today it is the second most important Chilean export, after copper…The United States and Japan are the world’s leaders in the harvest of wild salmon, while Norway and Chile are close competitors for the top spot in raising farmed salmon, responsible for 38.7 and 37.9 percent, respectively, of global production.”

The virus is called infectious salmon anemia or ISA, and is threatening the waters of chile.
In a March 2008 story in the New York Times “All these problems are related to an underlying lack of sanitary controls,” said Dr. Felipe C. Cabello, a professor in the Department of Microbiology and Immunology at New York Medical College in Valhalla that has studied Chile’s fishing industry. “Parasitic infections, viral infections, fungal infections are all disseminated when the fish are stressed and the centers are too close together.”

For Chilean farmers that grow winter canola it has been a tough year because the salmon industry is struggling and many acres of winter canola have been grown without a contract and they have no on farm storage. I met with one Chilean farmer who told me that it is a very tough time for winter canola growers with the commodity crash and the lack of canola buyers.

The salmon industry is working hard to rebuild itself but not without challenges as output is expected to drop 30 percent in 2009. Fish are still dying while the industry tries to increase the environmental and feeding practices of the industry. Some critics say that not enough is being done while others just want the salmon industry to stabilize so that the winter canola business has an end use market for farmers.